cik stringclasses 1
value | date stringlengths 8 8 | form stringclasses 4
values | sentenceCount int64 0 2.33k | sentence stringlengths 2 5.25k | filename stringlengths 40 40 |
|---|---|---|---|---|---|
0000320193 | 20101027 | 10-K | 774 | The Company opened 26 new retail stores during 2009, including 14 international stores, ending the year with 273 stores open. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 775 | This compares to 247 stores open as of September 27, 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 776 | With an average of 254 stores and 211 stores opened during 2009 and 2008, respectively, average revenue per store decreased to $26.2 million for 2009 from $34.6 million in 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 777 | The Retail segment reported operating income of $2.4 billion during 2010 and $1.7 billion during both 2009 and 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 778 | The increase in Retail operating income during 2010 compared to 2009 was attributable to higher overall net sales. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 779 | Despite the decline in Retail net sales during 2009 compared to 2008, the Retail segment’s operating income was flat at $1.7 billion in 2009 compared to 2008 due primarily to a higher gross margin percentage in 2009 consistent with that experienced by the overall company. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 780 | Expansion of the Retail segment has required and will continue to require a substantial investment in fixed assets and related infrastructure, operating lease commitments, personnel, and other operating expenses. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 781 | Capital asset purchases associated with the Retail segment since its inception totaled $2.2 billion through the end of 2010. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 782 | As of September 25, 2010, the Retail segment had approximately 26,500 full-time equivalent employees and had outstanding lease commitments associated with retail space and related facilities of $1.7 billion. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 783 | The Company would incur substantial costs if it were to close multiple retail stores and such costs could adversely affect the Company’s financial condition and operating results. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 784 | Gross Margin
Gross margin for the three years ended September 25, 2010, are as follows (in millions, except gross margin percentages):
The gross margin percentage in 2010 was 39.4% compared to 40.1% in 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 785 | This decline in gross margin is primarily attributable to new products that have higher cost structures, including iPad, partially offset by a more favorable sales mix of iPhone, which has a higher gross margin than the Company average. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 786 | The gross margin percentage in 2009 was 40.1% compared to 35.2% in 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 787 | The primary contributors to the increase in 2009 as compared to 2008 were a favorable sales mix toward products with higher gross margins and lower commodity and other product costs, which were partially offset by product price reductions. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 788 | The Company expects its gross margin percentage to decrease in future periods compared to levels achieved during 2010 and anticipates gross margin levels of about 36% in the first quarter of 2011. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 789 | This expected decline is largely due to a higher mix of new and innovative products that have higher cost structures and deliver greater value to customers, and expected and potential future component cost and other cost increases. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 790 | The foregoing statements regarding the Company’s expected gross margin percentage are forward-looking and could differ from anticipated levels because of several factors, including but not limited to certain of those set forth below in Part I, Item 1A, “Risk Factors” under the subheading “Future operating results depen... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 791 | There can be no assurance that targeted gross margin percentage levels will be achieved. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 792 | In general, gross margins and margins on individual products will remain under downward pressure due to a variety of factors, including continued industry wide global product pricing pressures, increased competition, compressed product life cycles, product transitions and expected and potential increases in the cost of... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 793 | In response to these competitive pressures, the Company expects it will continue to take product pricing actions, which would adversely affect gross margins. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 794 | Gross margins could also be affected by the Company’s ability to manage product quality and warranty costs effectively and to stimulate demand for certain of its products. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 795 | Due to the Company’s significant international operations, financial results can be significantly affected in the short-term by fluctuations in exchange rates. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 796 | Operating Expenses
Operating expenses for the three years ended September 25, 2010, are as follows (in millions, except for percentages):
Research and Development Expense (“R&D”)
R&D expense increased 34% or $449 million to $1.8 billion in 2010 compared to 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 797 | This increase was due primarily to an increase in headcount and related expenses in the current year to support expanded R&D activities. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 798 | Also contributing to this increase in R&D expense in 2010 was the capitalization in 2009 of software development costs of $71 million related to Mac OS X Snow Leopard. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 799 | Although total R&D expense increased 34% during 2010, it declined as a percentage of net sales given the 52% year-over-year increase in net sales in 2010. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 800 | The Company continues to believe that focused investments in R&D are critical to its future growth and competitive position in the marketplace and are directly related to timely development of new and enhanced products that are central to the Company’s core business strategy. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 801 | As such, the Company expects to make further investments in R&D to remain competitive. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 802 | R&D expense increased 20% or $224 million to $1.3 billion in 2009 compared to 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 803 | This increase was due primarily to an increase in headcount in 2009 to support expanded R&D activities and higher stock-based compensation expenses. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 804 | Additionally, $71 million of software development costs were capitalized related to Mac OS X Snow Leopard and excluded from R&D expense during 2009, compared to $11 million of software development costs capitalized during 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 805 | Although total R&D expense increased 20% during 2009, it remained relatively flat as a percentage of net sales given the 14% increase in revenue in 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 806 | Selling, General and Administrative Expense (“SG&A”)
SG&A expense increased $1.4 billion or 33% to $5.5 billion in 2010 compared to 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 807 | This increase was due primarily to the Company’s continued expansion of its Retail segment, higher spending on marketing and advertising programs, increased stock-based compensation expenses and variable costs associated with the overall growth of the Company’s net sales. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 808 | SG&A expenses increased $388 million or 10% to $4.1 billion in 2009 compared to 2008. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 809 | This increase was due primarily to the Company’s continued expansion of its Retail segment in both domestic and international markets, higher stock-based compensation expense and higher spending on marketing and advertising. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 810 | Other Income and Expense
Other income and expense for the three years ended September 25, 2010, are as follows (in millions):
Total other income and expense decreased $171 million or 52% to $155 million during 2010 compared to $326 million and $620 million in 2009 and 2008, respectively. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 811 | The overall decrease in other income and expense is attributable to the significant declines in interest rates on a year-over-year basis, partially offset by the Company’s higher cash, cash equivalents and marketable securities balances. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 812 | The weighted average interest rate earned by the Company on its cash, cash equivalents and marketable securities was 0.75%, 1.43% and 3.44% during 2010, 2009 and 2008, respectively. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 813 | Additionally the Company incurred higher premium expenses on its foreign exchange option contracts, which further reduced the total other income and expense. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 814 | During 2010, 2009 and 2008, the Company had no debt outstanding and accordingly did not incur any related interest expense. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 815 | Provision for Income Taxes
The Company’s effective tax rates were 24%, 32% and 32% for 2010, 2009 and 2008, respectively. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 816 | The Company’s effective rates for these periods differ from the statutory federal income tax rate of 35% due
primarily to certain undistributed foreign earnings for which no U.S. taxes are provided because such earnings are intended to be indefinitely reinvested outside the U.S. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 817 | The lower effective tax rate in 2010 as compared to 2009 is due primarily to an increase in foreign earnings on which U.S. income taxes have not been provided as such earnings are intended to be indefinitely reinvested outside the U.S.
As of September 25, 2010, the Company had deferred tax assets arising from deductibl... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 818 | Management believes it is more likely than not that forecasted income, including income that may be generated as a result of certain tax planning strategies, together with future reversals of existing taxable temporary differences, will be sufficient to fully recover the deferred tax assets. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 819 | The Company will continue to evaluate the realizability of deferred tax assets quarterly by assessing the need for and amount of a valuation allowance. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 820 | The Internal Revenue Service (the “IRS”) has completed its field audit of the Company’s federal income tax returns for the years 2004 through 2006 and proposed certain adjustments. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 821 | The Company has contested certain of these adjustments through the IRS Appeals Office. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 822 | The IRS is currently examining the years 2007 through 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 823 | All IRS audit issues for years prior to 2004 have been resolved. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 824 | During the third quarter of 2010, the Company reached a tax settlement with the IRS for the years 2002 through 2003. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 825 | In addition, the Company is subject to audits by state, local, and foreign tax authorities. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 826 | Management believes that adequate provision has been made for any adjustments that may result from tax examinations. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 827 | However, the outcome of tax audits cannot be predicted with certainty. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 828 | If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 829 | Liquidity and Capital Resources
The following table presents selected financial information and statistics as of and for the three years ended September 25, 2010 (in millions):
As of September 25, 2010, the Company had $51 billion in cash, cash equivalents and marketable securities, an increase of $17 billion from Sept... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 830 | The principal component of this net increase was the cash generated by operating activities of $18.6 billion, which was partially offset by payments for acquisition of property, plant and equipment of $2 billion and payments made in connection with business acquisitions, net of cash acquired, of $638 million. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 831 | The Company’s marketable securities investment portfolio is invested primarily in highly rated securities, generally with a minimum rating of single-A or equivalent. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 832 | As of September 25, 2010 and September 26, 2009, $30.8 billion and $17.4 billion, respectively, of the Company’s cash, cash equivalents and marketable securities were held by foreign subsidiaries and are generally based in U.S. dollar-denominated holdings. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 833 | The Company believes its existing balances of cash, cash equivalents and marketable securities will be sufficient to satisfy its working capital needs, capital asset purchases, outstanding commitments and other liquidity requirements associated with its existing operations over the next 12 months. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 834 | Capital Assets
The Company’s capital expenditures were $2.6 billion during 2010, consisting of approximately $404 million for retail store facilities and $2.2 billion for other capital expenditures, including product tooling and manufacturing process equipment and corporate facilities and infrastructure. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 835 | The Company’s actual cash payments for capital expenditures during 2010 were $2 billion. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 836 | The Company anticipates utilizing approximately $4.0 billion for capital expenditures during 2011, including approximately $600 million for retail store facilities and approximately $3.4 billion for product tooling and manufacturing process equipment, and corporate facilities and infrastructure, including information s... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 837 | Historically the Company has opened between 25 and 50 new retail stores per year. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 838 | During 2011, the Company expects to open 40 to 50 new stores, over half of which are expected to be located outside of the U.S.
Off-Balance Sheet Arrangements and Contractual Obligations
The Company has not entered into any transactions with unconsolidated entities whereby the Company has financial guarantees, subordin... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 839 | The following table presents certain payments due by the Company under contractual obligations with minimum firm commitments as of September 25, 2010 and excludes amounts already recorded on the Consolidated Balance Sheet (in millions):
Lease Commitments
As of September 25, 2010, the Company had total outstanding commi... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 840 | The Company’s major facility leases are typically for terms not exceeding 10 years and generally provide renewal options for terms not exceeding five additional years. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 841 | Leases for retail space are for terms ranging from five to 20 years, the majority of which are for ten years, and often contain multi-year renewal options. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 842 | Purchase Commitments with Contract Manufacturers and Component Suppliers
The Company utilizes several contract manufacturers to manufacture sub-assemblies for the Company’s products and to perform final assembly and test of finished products. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 843 | These contract manufacturers acquire components and build product based on demand information supplied by the Company, which typically covers periods ranging from 30 to 150 days. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 844 | The Company also obtains individual components for its products from a wide variety of individual suppliers. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 845 | Consistent with industry practice, the Company acquires components through a combination of purchase orders, supplier contracts, and open orders based on projected demand information. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 846 | Such purchase commitments typically cover the Company’s forecasted component and manufacturing requirements for periods ranging from 30 to 150 days. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 847 | As of September 25, 2010, the Company had outstanding off-balance sheet third-party manufacturing commitments and component purchase commitments of $8.2 billion. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 848 | The Company has entered into prepaid long-term supply agreements to secure the supply of certain inventory components, which generally expire between 2011 and 2015. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 849 | In August 2010, the Company entered into a long-term supply agreement under which it has committed to prepay $500 million in 2011. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 850 | These prepayments will be applied to certain inventory component purchases made over the life of each respective agreement. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 851 | Other Obligations
Other outstanding obligations were $1.1 billion as of September 25, 2010, which related to advertising, research and development, product tooling and manufacturing process equipment, Internet and telecommunications services and other obligations. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 852 | The Company’s other non-current liabilities in the Consolidated Balance Sheets consist primarily of deferred tax liabilities, gross unrecognized tax benefits and the related gross interest and penalties. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 853 | As of September 25, 2010, the Company had non-current deferred tax liabilities of $4.3 billion. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 854 | Additionally, as of September 25, 2010, the Company had gross unrecognized tax benefits of $943 million and an additional $247 million for gross interest and penalties classified as non-current liabilities. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 855 | At this time, the Company is unable to make a reasonably reliable estimate of the timing of payments in connection with these tax liabilities; therefore, such amounts are not included in the above contractual obligation table. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 856 | Indemnifications
The Company generally does not indemnify end-users of its operating system and application software against legal claims that the software infringes third-party intellectual property rights. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 857 | Other agreements entered into by the Company sometimes include indemnification provisions under which the Company could be subject to costs and/or damages in the event of an infringement claim against the Company or an indemnified third-party. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 858 | However, the Company has not been required to make any significant payments resulting from such an infringement claim asserted against it or an indemnified third-party and, in the opinion of management, does not have a liability related to unresolved infringement claims subject to indemnification that would materially ... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 859 | Therefore, the Company did not record a liability for infringement costs as of either September 25, 2010 or September 26, 2009. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 860 | The Company has entered into indemnification agreements with its directors and executive officers. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 861 | Under these agreements, the Company has agreed to indemnify such individuals to the fullest extent permitted by law against liabilities that arise by reason of their status as directors or officers and to advance expenses incurred by such individuals in connection with related legal proceedings. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 862 | It is not possible to determine the maximum potential amount of payments the Company could be required to make under these agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each claim. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 863 | However, the Company maintains directors and officers liability insurance coverage to reduce its exposure to such obligations, and payments made under these agreements historically have not materially adversely affected the Company’s financial condition or operating results. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 864 | Item 7A. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 865 | Quantitative and Qualitative Disclosures About Market Risk
Interest Rate and Foreign Currency Risk Management
The Company regularly reviews its foreign exchange forward and option positions, both on a stand-alone basis and in conjunction with its underlying foreign currency and interest rate related exposures. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 866 | However, given the effective horizons of the Company’s risk management activities and the anticipatory nature of the exposures, there can be no assurance the hedges will offset more than a portion of the financial impact resulting from
movements in either foreign exchange or interest rates. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 867 | In addition, the timing of the accounting for recognition of gains and losses related to mark-to-market instruments for any given period may not coincide with the timing of gains and losses related to the underlying economic exposures and, therefore, may adversely affect the Company’s financial condition and operating ... | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 868 | Interest Rate Risk
While the Company is exposed to interest rate fluctuations in many of the world’s leading industrialized countries, the Company’s interest income and expense is most sensitive to fluctuations in the general level of U.S. interest rates. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 869 | As such, changes in U.S. interest rates affect the interest earned on the Company’s cash, cash equivalents and marketable securities, the fair value of those investments, as well as costs associated with foreign currency hedges. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 870 | The Company’s investment policy and strategy are focused on preservation of capital and supporting the liquidity requirements of the Company. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 871 | A portion of the Company’s cash is managed by external managers within the guidelines of the Company’s investment policy and to objective market benchmarks. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 872 | The Company’s internal portfolio is benchmarked against external manager performance. | 0001193125-10-238044/full-submission.txt |
0000320193 | 20101027 | 10-K | 873 | The Company’s exposure to market risk for changes in interest rates relates primarily to the Company’s investment portfolio. | 0001193125-10-238044/full-submission.txt |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.